When may you be held liable for damages caused by goods?

The producer or importer, distributor or retailer of any goods is liable for any harm caused wholly or partly as a consequence of:

• supplying any unsafe goods;
• a product failure, defect or hazard in any goods; or
• inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of any goods,

irrespective of whether the harm resulted from any negligence on the part of the producer, importer, distributor or retailer, as the case may be.

Liability of a particular person in terms of the aforementioned does not arise if:

• the unsafe product characteristic, failure, defect or hazard that results in harm is wholly attributable to compliance with any public regulation;
• the alleged unsafe product characteristic, failure, defect or hazard:
  • o did not exist in the goods at the time it was supplied by that person to another person alleged to be liable; or
  • o was wholly attributable to compliance by that person with instructions provided by the person who supplied the goods to that person;
• it is unreasonable to expect the distributor or retailer to have discovered the unsafe product characteristic, failure, defect or hazard, having regard to that person’s role in marketing the goods to consumers; or
• the claim for damages is brought more than 3 years after the claim arose.

The harm for which a person may be held liable  for includes:

• the death of, or injury to, any natural person;
• an illness of any natural person;
• any loss of, or physical damage to, any property, irrespective of whether it is movable or immovable; and
• any economic loss that results from harm contemplated above.

What are the effects of non-compliance with the CPA?

Should a supplier not comply with the provisions of the CPA it may be liable to a fine which may not exceed 10% of its annual turnover or R1 million Rand whichever is the greater.

Marketing “do’s” and “don’ts”

In general a supplier must not market any goods or services:

• in a manner that is reasonably likely to imply a false or misleading representation concerning those goods or services; or
• in a manner that is misleading, fraudulent or deceptive in any way

A  supplier must not engage in “bait marketing” which is advertising any particular goods or services as being available at a specified price and in such a  manner that it may result in consumers being misled or deceived in any respect relating to the actual availability of those goods or services at that advertised price.

Furthermore a supplier must not engage in the practice of “negative marketing” which entails that  goods or services will be supplied, or an agreement or modification will automatically come into existence, unless the consumer declines such offer or inducement.

06 July 2011